There is no question owning two cars can be fun on the road and impressive in the driveway, but have you thought about what it can mean for your auto insurance rates? There are some simple questions you have to ask yourself before purchasing two vehicles to your name and filling up the garage.
It may seem confusing that you need insurance on both cars when you can only drive one at a time. But the fact of the matter is you do need insurance on both just like you need two registrations and two license plates.
So what if you do have two cars but only drive one a majority of the time? What does this mean for your auto insurance rates? The good news is being a driver with two cars will put you in a lower premium for the second vehicle. If you have a seasonal vehicle you have the potential to get lay-up coverage, which will reduce the amount of coverage on the vehicle while reducing your premiums as well.
With that said, it is important to note you will need to possess at least minimal liability insurance coverage on both vehicles no matter what you drive, how much you drive or where you live. It is possible though to reduce your liability coverage during the months it is laid up.
What if there are two drivers in the house? Do auto insurance rates differ from the primary to the secondary driver? There are some car insurance companies that will rate a specific driver to a specific vehicle with the highest-rated driver being assigned to the highest-rated car. The whole goal of insurance companies is to assess risk and put a safe driver behind a safe vehicle.
Something you may not be familiar with is stacking coverage, which allows you to collect from more than one policy you own to cover your medical bills and property damage. Stacking is a bit complicated as it is not allowed in all states and each company has its own rules. But if you have multiple auto insurance policies and are hit by an uninsured or underinsured driver, it will come into play.
The question that everyone wants to know at the end of the day is whether or not auto insurance rates will be lower when insuring multiple cars. The good news is there are multicar discounts when insuring each from the same company. Not only will you get a discount, but a huge saving with most companies offering as much as 15 to 20% or higher. And often times the multicar discounts will apply to parents, children and anyone else in the household.